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Obama Orders Sanctions, US Reaches Out to Moldova, Georgia as Ukraine Crisis Continues

President Barack Obama issued a broad Executive Order today aimed at any and all parties determined to be “responsible for or complicit in” threatening the sovereignty of Ukraine. The full Order names no entity specifically, blocking “all property and interests in property that are in the US, that hereafter come within the US, or that are or hereafter come within the possession or control of any US person (including any foreign branch)” of any party the Treasury and State Departments determines is contributing to the ongoing situation in Ukraine.

Blocking “all property and interests in property” prohibits US companies from making any contribution or provision of funds, goods or services by, to or for the benefit of any person whose property and interests in property are blocked, pursuant to the Order. Since its stipulations are so broadly drawn, the Order could have serious ramifications for US companies with interests in the area, and these entities should immediately review their dealings with customers in the region to avoid running violating the Order.

The sanctions were the latest step taken by the US as it scrambles, with the European Union, to punish the Kremlin's incursion into Ukraine's Crimean peninsula. "This EO is a flexible tool that will allow us to sanction those who are most directly involved in destabilizing Ukraine, including the military intervention in Crimea," said White House Press Secretary Jay Carney, adding that the Order "does not preclude further steps should the situation deteriorate."

Prior to the Order, the US had previously moved to shore up its other trade ties in the region, as Trade Representative Michael Froman reached out to the heads of two former Soviet satellite states that serve as important strategic buffers between Russia and the West. Just before the end of February, Froman met in Washington with Georgian Prime Minister Irakli Garibashvili to discuss the countries' shared interest in increasing bilateral trade and investment and continuing the US-Georgia High-Level Dialogue on Trade and Investment. Then, earlier this week, Froman and Moldova's Prime Minister Iurie Leancă opened the meeting of the US-Moldova Joint Commercial Commission, where officials worked to bolster trade between the US and Moldova as Froman confirmed US support for Moldova's efforts to integrate with Europe.

Russia has attempted in the recent past to bring both Georgia and Moldova further into their economic sphere of influence, most recently using flimsy accusations of impurities to ban imports of Moldovan wine last year to punish the country after it signed a free trade agreement with the EU. The West accommodated Moldova after the ban, with the EU reducing tariffs on the country's wine, which serves as the lynchpin of Moldova's agriculture industry, and Secretary Kerry announcing a US trade mission to help Moldovan exporters enter the American market. Froman's attempts to reach out to two countries previously targeted by Russia for potential buffer-state status are no coincidence, particularly as the Kremlin continues to assert itself in Crimea, and the Order, though broad, aims to isolate Russia without negatively affecting the US' strategially-important trade ties in the region.

1 comment:

More Washington hypocrisy. Our federal government reserves the right to invade any country where "its interests" are threatened (i.e. Kuwait, Iraq, Afghanistan), and to kill anyone, anywhere, who has declared jihad/war on the US (drone strikes in Pakistan, etc.). Yet when an illegal coup takes place, in direct violation of the Ukrainian constitution, and the lawfully elected president asks Russia to intercede, the Administration gets its panties in a wad and starts threatening Putin. I have no love or respect for Putin, or his intentions, but at times like this I have even less for our own officials. They should bear in mind the potential backlash: Russia dumping US Treasuries and seizing US assets in Russia. The US would be better served by minding its own backyard and refraining from being the world's policeman.

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